Which statement best describes the PRA requirement to maintain resources?

Which statement best describes the PRA requirement to maintain resources?

• A. A firm must at all times maintain adequate financial resources
• B. Deal with regulators open and cooperative
• C. Conduct business with integrity
• D. Prepare for resolution

Answer: (A)

The main idea is ensuring a firm's financial resilience by keeping sufficient resources. The PRA is focused on the prudential soundness of a firm, so it requires that the institution always holds adequate financial resources—primarily capital and liquidity—to cover potential losses and meet obligations, even under stress. This ongoing resource adequacy supports the firm’s ability to continue operating without external help and to absorb adverse shocks. The other statements describe important regulatory expectations in different areas—how a firm relates to regulators, how it should conduct its business, and plans for resolution—but they don’t capture the ongoing requirement to maintain financial buffers.

The main idea is ensuring a firm's financial resilience by keeping sufficient resources. The PRA is focused on the prudential soundness of a firm, so it requires that the institution always holds adequate financial resources—primarily capital and liquidity—to cover potential losses and meet obligations, even under stress. This ongoing resource adequacy supports the firm’s ability to continue operating without external help and to absorb adverse shocks.

The other statements describe important regulatory expectations in different areas—how a firm relates to regulators, how it should conduct its business, and plans for resolution—but they don’t capture the ongoing requirement to maintain financial buffers.